Amazon’s ‘Anticompetitive’ Warranty Conditions Violate Federal Law, Class Action Says

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A proposed class action alleges Amazon.com Services has violated federal law by representing that its product warranties will be void if consumers use third-party repair services to fix certain Amazon-branded products.

The 14-page lawsuit was filed by a California consumer who claims he cannot fix the Amazon Echo Show 10 he bought in June 2021 via a third-party, independent repair service without risking the loss of the product’s warranty. Per the complaint, the plaintiff has been deterred from seeking outside repairs because Amazon says its warranty does not apply to devices that have been “subject to accident, misuse, neglect, fire or damage from other external causes, alteration, repair, or commercial use.”

Under the federal Magnuson-Moss Warranty Act, it is illegal for a retailer to “tie” the validity of a warranty to the use of only authorized repair services or parts, the case states.

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Additionally, Amazon “explicitly and implicitly” conveys to its customers that merely opening its products will void their one-year warranty, even though the Magnuson-Moss Warranty Act prohibits this condition, the filing asserts.

According to the suit, Amazon’s alleged misconduct is an attempt to monopolize the device repair market since “most people won’t attempt relatively simple, inexpensive repairs – or use inexpensive third-party repair services – if they believe that in doing so the manufacturer subsequently will refuse to honor the warranty.”

The complaint argues that by limiting consumers’ options, Amazon’s “tying” arrangement consequently drives up repair costs and wait times, and it can even cause shortages as supply chains struggle to keep up with increased demand. 

The “anticompetitive” practice also enables Amazon to “force consumers to buy new products through planned obsolescence,” the case reads.

“When it costs almost as much to repair an existing product as it does to buy a new version of the same product, consumers will likely opt to buy the new product,” the case reads. “Whereas, in a repair marketplace where costs are lowered through competition, it is cheaper to repair an existing piece of electronics than to buy a new one.”

The lawsuit looks to represent anyone in California who purchased a product subject to Amazon’s warranty within the past year.

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